The COVID-19 pandemic is having a significant impact on business across the globe, including retail and consumer products sector. As the coronavirus pandemic disrupts the lives and livelihoods of millions, retailers had to rework their business model and are striving to implement changes that will be needed once the outbreak subsides and stores can reopen.

Grocery/ supermarkets experienced increased demand in essential categories like food, sanitary supplies etc., while the demand for luxury and non-essential retail products suffered significant drop. There is a spurt in customer shift towards online shopping, resulting in acceleration in adoption of e-commerce, placing pressure on the existing technology infrastructure, supply chain and security related areas.

Retailers had to deploy Crisis Management and Emergency response procedures to address the sudden challenges and to tap the opportunities from the crisis. They had to rework many areas of their operations, including supply chain, technology, reskilling staff, business processes etc. Most retailers were forced to prioritize cash preservation and implement cost reduction /optimization measures to ensure they can survive the crisis. Given the high transmission rate of COVID they also had to maintain a delicate balance between implementing these changes and ensuring safety of the employees, vendors and customers.

As markets across the globe begin to open, we return to a world that's very different to the one we knew. Most companies will strive to position their offerings to cater to the new needs emerging in their markets. These will increasingly require localization, quality, transparency and technology to be part the offering. With more and more consumers spending time online, marketing, communications and consumer touch points are moving to the virtual space. 

Some key trends expected in the retail / FMCG are as below:
Shift to online as demand will remain strong: Online shopping has clearly grown manifold during the crisis, and this isn’t really surprising considering that people were requested to stay home and those in the most at-risk category had a strong motivation to buy their essentials online.

Less eating out, more re-creating the experience at home: Several restaurants, cafes and bars have closed during the lockdown period in each country. Some have moved to a delivery only model and this has been made easier with the online aggregators.



Focus on hygiene and health concerns will imply more attention to quality: Perhaps not surprisingly, health and hygiene have become a much higher focus for everyone during the pandemic. Just looking at sales of cleaning products implies how important this has become.

Omni channel is non-negotiable: In a post-COVID world, if there is one thing on which retailers have a consensus on, it is the necessity to offer Omni channel shopping experience. Omni channel or online retailers may be better positioned to deal with store closures but that should not come at the cost of customer experience..

Mid to large retail companies in the region having minimal online footprint are increasing their digital presence. They are utilizing their existing resources i.e. warehouse, manpower, brands, etc. to deepen their online presence. However smaller retail companies with single or few brands in their portfolio and having limited retail presence are finding it difficult to sustain the business. Low sales coupled with high rents and salary costs have impacted their profitability
Other important trend emerging in the region is that large family houses that do not have retail presence are evaluating to pool their resources and enter the online commerce. Due to lower utilization of their existing assets they want to be part of the digital commerce value chain and monetize their assets.



Use of digital tools has accelerated faster than expected since the onset of Covid-19. Mall owners and operators are adopting several tech-enabled pathways to support retailers including collaborating and partnering with leading e-commerce platforms allowing customers to shop online from the mall’s stores.

Organized retail for many brands consists of sales from modern retail outlets, regional branded stores, company stores and e-commerce. The old style of in-store and even online retail was firmly focused on products sales. Post COVID-19 concepts of experiential retail will emerge than a mere product push. Stores will need to create engrossing experiences for the customers. The emergence of virtual reality, augmented reality and improved mobile technology will help brands add new experiences and gain more market traction, compared to traditional methods. These technology driven stores will have limited human interactions with adequate social distancing regulations in place

Businesses must be agile yet cautious and combine data based insights with creativity to drive decisions. A corporate vision coupled with strategy that leverages all these factors will be able to steer its business through the upcoming challenges and tap into the opportunities in the uncertain post COVID world.

Harish Visweswaraiah: Managing Director, Protiviti Member Firm for the MENA Region



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